OK And Piers we have are corm So we're going to have
a roll call the start the meeting now man clerk please call their own common Bosley
. Kennedy Conway five.
More. French President Carter.
He stepped out of the right bottom and cultured here on
a limb and Spencer. Graeme.
Pearman wrote present. We have several items of business today
the. We have several board bills as we discussed previously we're going to go
through and do a little kind of. An educational piece and then
a number of you have requested an update on the. North side project
and so at the end of today's session as the last agenda item. We'll go ahead
and go into closed session discuss that I apologize for the short morning on that
we have been talking about that and this is the last meeting before we go out and I
want to know if we had the opportunity I want to get through and I want to call
everybody out over the summer so it wasn't an attempt to give everybody
a last minute notice. But it worked out that way. The first item on the agenda I
thought was we could go ahead and spend
a few minutes going through Community Improvement District special business
districts and transportation development districts as I. Warned everybody before as
opposed to me doing monologues and all these things we thought we'd bring in some
featured speakers and so today I'm bringing in I've been bided the staff that I've
worked so closely with over the years Park Central and they're going to walk us
through these these development tools but way
a backgrounder reorient ourselves what we're talking about is ways of adjusting the
tax to service ratios so the first set of presentation that we had last week our
last meeting with Bill Keeling and volved the idea of reducing taxes to encourage
businesses to come in this is this is actually just the opposite this is increasing
taxes with the idea that you can offer
a more robust. Suite of services. By increasing the taxes so with that
introduction. We'll go ahead and turn it over to the executive director of Park
Central works got
a girl to walk us through our home and spend about fifteen minutes on this then
we'll take up the board bills and. Go into executive session after that didn't.
Work yet. Thank you.
OK. Great.
Thank you again for having us. We the part of the special taxing districts is
a resource
a tool that many of you aldermen may be able to utilize in your areas in order to
bring in additional funding to your neighborhoods or your districts at Park Central
were one of the remaining fifteen or so development corporations that are left in
the city and we do not act as. Some Something like some of the other development
corporations we do not do any physical development property management instead we
actually work on other community development tools such as safety and security
public infrastructure parking. Attracting investment developers businesses
residents to the area we now coordinate special events and we do
a lot with marketing and one of the things that we've developed our niche with is
actually implementing and then and minister in these special taxing districts for
a very nominal fee so our team I park Central we actually have five staff people
and then we usually have about four or five in turns that assist us on these
efforts and we're working with these taxing districts and in fact we have Minister
four of them currently in the seventeenth ward and then we're working our board has
actually approached us about working in some other neighborhoods and districts so
possibly helping start up in MINISTER some other special Texan districts in other
areas so just to give you familiar again with the four that we currently in Mr
Here's the central west and south special business district and special business
districts are really
a misnomer special business districts are mostly used for residential. Areas
and Susan Anderson one of our colleagues here Shogun going to go over exactly what
it means for special business districts and the difference between special business
districts and Community Improvement districts so here's the central west and south
these special business districts it's a some seven member board of directors on is
a two hundred twenty four thousand dollar annual budget of. Two primary expenditure
categories safety and security and then lighting they do some landscaping along
with it but it's all for safety and security purposes for that area. Here's the
south central west and south special business district this was one of the first
special business districts in the city of St Louis Susan and her son actually
helped implement back in one thousand nine hundred seven and again this is seven
more member board of directors and it brings in one hundred eighty six thousand
dollars each year and they have three primary expenditure categories safety and
security public infrastructure improvements and clean and landscaping. About eight
years ago was that they the state actually allowed for Community Improvement
districts and S.B. D.S.
To actually work together and to have an overlay on top of each other prior to that
if you had
a special business district or communion permit district you cannot have them in
the same area so as of last year Park Central worked with the Euclid the South
Euclid area south of Lendl and created a community improvement district that is
a one percent sales tax for the area. When the Whole Foods gets open that
should bring in about three hundred fifty thousand to four hundred thousand dollars
a year that is again
a seven more member board of directors that has five committees associate it with
that they have four primary expenditure categories safety and security public
infrastructure marketing and then cleaning and landscaping so it is really the
South special business. Strict was not able to provide enough resources for the
area so the community felt that they needed to bring in additional funding and so
the businesses in that were really pushing for
a commune improvement district in the area so Park Central was happy to assist with
that effort. And the group Community Improvement District has been in place now for
seven years. So it's
a long Manchester in the forest park southeast neighborhood was created in two
thousand and eight has an eleven member board of directors there's eight committees
associated with it it's
a three hundred thousand annual budget and one percent sales tax so two hundred
thousand of the three hundred thousand dollars budget comes from sales tax and the
one hundred thousand comes from the special assessment from the properties in the
area there are five primary expenditure categories fifty percent for safety and
security ten percent for public infrastructure percent for marketing and special
events ten percent for cleaning and landscaping and ten percent for parking and
again Park Central and ministers the special business districts for about
a six percent fee of their. Six percent of their annual budget and for the
Community Improvement districts it's about thirteen percent of their annual budget
at this point I'll go ahead and turn it over to Susan Anderson who's definitely
been implemented she helped implement the south brand Community Improvement
District and helped get off the South Euclid community permit district last year.
As you all know these are political subdivisions they're voted in by the residents
and the landlords if you are a property owner with
a special business district you have a vote as a landlord It's
a special ballot and the registered voters and also vote at the poll so it can take
take place at the same time the property tax can be up to eighty five cents per one
hundred dollars valuation but then after
a certain time the state gets involved and that percentage is reduced so that the
taxpayers aren't hit too hard the potential services are those that have been the
best for improving the district as
a whole it's what the neighbors have told us they need and you can fine tune one so
that it is dresses those needs if landscaping is not an issue you don't have to put
it in there. If you do you don't necessarily have to spend the majority of your
good portion of your money you can scale that back and as times change you can
address those differences.
Were Community Improvement District. One. Has
a history of ready Canada and then down in New Orleans. With the
districts. In the city. Many of them are sites of some of
them are for an actual business district like. They've grown in popularity because
they do have the ability to have the one says sales tax and especially on the
property.
Creation of this earth said is requires two different tests that you're going to
someone's going to be going to be. Thank you. Someone's going to be going to the
property owners to get their vote which is notarized. That gives you an opportunity
to talk one on one and really explain how this is going to happen get there by and
potentially
a board member of the property or the voters then cast their vote through
a mail in ballot that's the only one that I know of that is like that.
On South Grand when we set up the said those ballots were mailed to all of the
residents you have to have
a simple majority I had one person who voted and mailed his card back so that
approval hinged on that one ballot because it was my fifty one percent.
Broad uses or very similar to the S.P.D.
So that you can have those services that the neighbors have identified business
owners that have identified that they need but you can also work to attract
businesses to attract developers
the petition process starts with those notarized ballots from the property owners
then it goes back to you submitted to the board of all the men it's established
then the voters get their mailing card to establish the sales tax. It's
a lengthy and. Very tedious petition but it makes sure that everyone gets
a say so it's.
You could solve. Said we had seventy two percent approval folks there
recognize that with the coming of more and more businesses more and more residents
we needed more help than what the S.P.D.
Could provide with trash with public safety they wanted to have
a vent they want this to be
a really great neighborhood with the said that provides those funds so that we can
do that. And of course since
these are political subdivisions we have the sunshine law we have to meet all of
those requirements all the meetings are public we post the notices must be within
the District twenty four hours before the actual meeting and then there are reports
that we give to the Board of Aldermen and to the state showing all our finances how
we've gathered that money how we spent it if we're restricting funds for
a project that's coming up in the future so we can save money for
a larger project that is shown as well so you can also request
a report from the Department of Revenue that shows each one of your tax payers the
folks who are collecting your sales tax so that you can see how your purchases are
arranging so that you can arrange your budget
a little bit better but that's private information only the folks that are actually
working with those funds are allowed to see that so we don't that's not shared
in math and transportation district.
OK thanks for let me talk today my name is Matt Grimm
a project manager at Park Central right now Park Central does not administer any
transportation development districts but I'm sure you all know there are quite
a number of them in the state of Missouri and in the city of St Louis actually. You
have to kind of look at them as. Similar to Community Improvement districts in that
they've grown in popularity since their inception. Transportation development
districts became law in one nine hundred ninety in the state of Missouri. Since
then there are hundreds in the state of Missouri they the things that they can fund
are different than Community Improvement districts though the projects have to
focus mostly on transportation related issues so you'll see
a lot of these in rural areas
a lot of areas that are right off of highway exits
a lot of smaller cities and towns use these as well. The projects there's
a comprehensive list up on the end in your packets of what they can fund but mostly
streets highways intersections bridges bus stops airports ports railroads light
rail things like that. Before
a project gets implemented it has to be submitted to the Missouri Highway and
Transportation Committee for approval now if the project is not under the purview
of that commission then it has to go to the local transportation authority who then
will become the owner of that transportation project. This is just it's
very wordy but it's
a bit about how they get implemented transportation development districts they
require
a petition to be filed in the Circuit Court of the district you have to have at
least fifty registered voters within the district since
a lot of these are at off ramps or smaller towns they may not have registered
voters there so if that's the case the owner of the properties they
can submit the petition. The district has to be
contiguous unless the district is being funded solely from sales tax
just like Community Improvement District it can be funded through sales taxes and
special assessments the rates are a bit different but
a lot of these transportation development districts do. Get their funding from
sales taxes. So there can be up to one percent sales tax downtown St
Louis has actually
a number of transportation development districts which are on top of Community
Improvement District So if you see higher rates on your restaurant bills downtown
and maybe because you're paying two percent more than an area that doesn't have
a Community Improvement District or
a transportation development district there can be special assessments it's much
lower then that's P.T.S. S.P.
D.'s can go up to eighty five cents per one hundred dollars of assessed valuation
transportation development districts can only do
a dime per one hundred percent assessed evaluation. And then
a lot of municipalities and developers like to use transportation development
districts because they can be used in conjunction with. Tax increment financing
half of the economic activity taxes so the sales taxes that are captured in that
one percent can be used to pay off the bonds for the tip so again this is kind of
community improvement districts in transportation development districts you can
kind of view them as the third major wave in St Louis and even the state of
Missouri economic development tools the first it was probably property abatement
then tax income and planting now since two thousand and eight numbers have doubled
for community improvement to section Chantry transportation Velma district in the
city of St Louis so. Back to Brooks.
As I mentioned previously
a lot of different neighborhoods and districts have been approaching Park Central
asking for assistance with developing
a special taxing district some of the vise when we go in and talk with these
neighborhoods are we go ahead over some questions that they may want to ask
themselves before getting into the process so one of the first things we get into
is our constituents requesting added services outside of the city's current
services so this may relate back to your constituents are you having constituents
coming back to you and asking for added services that the Currently the city is not
providing. And then with that is there an agreed upon list of services
that you would actually be able to you know put together you know
a consensus based on what those lists of services are three years ago are actually
our predecessors Park Central and want to head in and worked with the Forest Park
southeast neighborhood to try to get
a special business district passed in the neighborhood part of it is some of it was
talked about that it may have been
a top down approach from Park Central to the neighborhood so the neighborhood has
now approaches again about possibly looking at
a special business district once again and what we have said is we'd like to go
ahead and put together a committee have
a year long process looking at some Then like this actually work with the community
look at what are the needs the needs assessment for the neighborhood and if the
community is
a you know we hear all the time it's you know taking care of the public infrastructure
in the parks and safety and security in those types of issues can we go ahead and
develop some you know friends of the parks or you know go ahead and have some
cleanup crew some volunteer crews that are happening in the neighborhood and then
after that what is left is are still needed services that need you know that
require funding to gold. Long with it so the really go ahead and do
a whole analysis for
a neighborhood looking at all of the needed services and what services can be met
through volunteer work and that and then what need to be met with additional
funding. Looking at the numbers is there enough sales tax in or assessed value to
meet those require that services so this is again it's
a pretty easy process to go ahead and look back at this value for the properties in
the area so you can go ahead and look at that eighty five cents per one hundred
dollars and see if that would bring in enough revenue to actually help with these
services and then besides that you can go ahead and go to approach the license
collector in the state the Missouri Department of Revenue and go ahead and say this
is a district that we're looking at to implement
a sales tax here is there enough revenue in that area they were to actually make
sense to go ahead and have
a Community Improvement District there. The this is kind of been
given in order and after this process looking at it are there enough committed
community stakeholders that would serve on
a formation committee and help educate neighbors regarding the benefits of
a special taxing district so again you know community development corporation or an
alderman is not going to be able to go out and do this on their own they really
need to have by and for it they need to have the community wanting this to occur in
their area. And then with it is their staff available to work behind the scenes
gather petition signatures and educate the public we have seen from our experience
that this is really about
a nine month to sixteen month process if you're going to want to go ahead and get
it accomplished and get that community buy in for it. And then last but the thing
to look at too it's always about funding are there sponsor vailable for legal fees
mailings and notices there have to be published to public notices about the
different hearings on that that are associated with it and then the legal fees can
mount to between fifteen thousand to thirty thousand dollars to end up writing the
petitions and getting these on the ballots so those are things that we talk about
with all the different areas and go over so that concludes So we're happy to answer
any questions Thanks Brooke I'd like to make a couple comments and open up for
a couple questions we don't want to take too long because we've got folks waiting
down for bills to be heard today and we have orders to go through. Just
I always like to try to have we have these meetings
a couple weeks go by we kind of forget what we're doing and you know trying to
reorient everybody. The way we got to where we are we the city lacks
a business plan it will be over a year or so probably before we get
a business plan in the interim we don't want to just sit still and wait. You know
for that and so in my presentation one of the bullet points that I don't think
anybody can argue with was you know where we begin the centralizing localizing
empowering some of the neighboring planning so that's why we're talking about what
we're doing here and the just of this is.
There's
a number of people in St Louis that are very concerned that these Cup Those have
got their funding cut they used to get funded through block grant and many of those
are going by the wayside and we're very concerned about. You know what's going to
happen you know within our neighborhoods if we don't have
a vehicle to develop consensus building consensus building is
a credibly time consuming process and. You know we're
not going to resource for that and there's
a group called Community builder network if they if you haven't met with them it
probably
a good thing for you at least to get to know who they are and they're working on
this pretty fever surely trying to come up with some solutions perhaps leveraging
this with some philanthropic monies I have actually been calling on some
foundations myself. So you know what we're we're
trying to do is is to provide resources to neighborhoods to help begin figuring out
how to do some of these things themselves and some of these these Community
Improvement District since special taxing districts that have been I found very
helpful. Just wanted to comment on
a couple of the experiences we've had with them. Actually this special business
district when it was first started was intended to give urban retail stretches like
a Manchester are you quit or
a Cherokee or any of these other you know Martin Luther King or any of these other
former retail hubs which were the downtowns of their neighborhoods and the new
malls that would go in which might have one hundred two hundred stores and had
a central kind of planning authority so they could go ahead assign rent and in as
part of that rent they would provide security and
a common marketing theme come to such and such
a mall Well you know if you have fifty shops along
a block several blocks there's no unifying central planning and so that was the
initial concept when they set these things up and then they have eventually
liberalize. Them so that you could start using
a more neighborhood areas for residents as well what we found in our area is
a commercial strips actually create value you know it's
a love hate thing that happens with you know these commercial strips what happens
is if they have
a minute easy on them people will want to live close to those and the seventeenth
ward we focused on Sarah you would Manchester with the idea that if we fix them up
they would actually prop up the values around them but the love hate is they get
busier. You know people love the amenities within walking distance but they hate
the crowds from out you know so you have to deal with that and of course the
biggest of the most expensive of those is parking and parking you know structured
parking is
a. Ten to twenty thousand dollar difference in surface parking and these things
provide resources to help begin dealing with those each neighbor its problems are
going to be
a little different we think of the skill sets that's necessary to do some of these
things you need
a consensus building group somebody go out and engage the community you're going to
need to have somebody help you do the legal work you have to have somebody help you
do the financial analysis. And you have to figure out
a way to pay for all that so our hope is is that we'll be able to go ahead and
create a team over at C.T.A.
R S L D C I'm not sure who will actually be doing that but that will actually go
out we'll pick one or two
a year and try to see how this works and just the act of forming these committees
getting people together even if the money is not enough. The active everybody begin
getting together and discussing the problems and helping prioritize them you know
and you'll see that the list change some areas it's going to be security others
will be parking others that will be picking up the trash and but the fact that you
get people to gather and then they begin thinking about it and they start bringing
in some of their own resources and creativity and energy. Does
a lot so anyway that's why we're here is there any questions that Brooks or any
comments on what we've covered today at all or. The other thing is kind of
tying this together with what we discussed before and we really didn't get into to
districts which is. Something that I think we should be using more of but there's
been opposition to in the past and that's where. We go ahead and typically when we
used to for to for tax abatement the city we're providing all the economic benefit
back to the developer So if
a project costs this much to develop and it's only worth this much we're giving all
of that economic benefit back to the developer what
a tiff district does is it gives you the ability to calibrate that
a little bit so that instead of just giving all the benefit back to the developer
you can keep some of that benefit and apply it to
a community purpose that will in Athens will hopefully enhanced the value of
everybody's property not just the property being developed. So as an example of
that when you do it if district if Whiting in the security is an issue for you you
can go ahead and some of the economic benefit you can award to the developer and
others you can keep and use for lighting within that neighborhood there by having
the street lead hopefully will increase the value of all the property in the area
that makes sense everyone and. If there's no questions then we'll go ahead and
finish that up for today that will be the last of these for this session because
this is the art till we come back in the fall and then we're working on some stuff
to help quantify. And. Keep this presentation going and I expect they have two or
three more of them anyway. So with that said why don't we go ahead and pick up the
board bills and we'll do these and. I guess we got here.
When we go ahead and start. Tonight maybe we can hold hours that leaves
us with the farmer hand. Who sponsored who's the sponsor of the
resolution Here's
a. Morning OK. Ok much shorter seniority orders here.
OK Well go ahead start with. Alderman Vollmer then he has two board bills before
someone twenty in one twenty one. OK you're.
Twenty. But I think you Vanna White.
Is dealing with
a redevelopment plan. For Jerry Ackerman Toyota Motor Company this is the site of
the old M S D headquarters for you youngsters you might not remember where that was
that is right nor the forty Ford Hampton they closed up some time ago the building
has been vacant this is on the outskirts of the tenth ward and is quite an eyesore
I would say it's been uninhabited but we have found many people residing in there
without proper leases. We have had many people come forth trying to develop
this and this is the plan that. Fits and works very well because this is
a difficult property to develop there is
a thirty inch city water main that runs through that cannot be built upon it has to
be. Somewhat thrown into the plan it is
a property if you have gone by there this isn't from the street department where it
starts and it keeps going down to
a small taper and downhill so they have many many things to conquer here and they
have come up with
a plan that will work very well and we are going to
request that you keep your favorite consideration to it we have people here from.
Adamantly from their team if you have any specific questions related to. What is
occurring and as well Otis is here and deal we can go through I have this to hand
out and you have enough of them. But this site is quite an eyesore this new
building the Ackermann folks are currently located on Kings Island fellows and they
are required to have
a larger footprint as you know as with most car dealerships. In the city and
throughout the area they are putting these new buildings in that the they have to
have or they will not be able to stay at their current location I will be moving
from the fellows in area to this and they have plans to keep the flows an area
going with another dealership also they have put applications in so we will not
have only one new will still have an existing dealership will be adding employees
to the city of St Louis and creating at the other end of Hampton Avenue where
Mr already has put his wonderful Mercedes Benz dealership in as you travel south
you will now find a wonderful Toyota dealership creating
a little mini mall for cars on Hampton Avenue. You will have your packets.
Yes or all of them and I'm sorry it's OK Joe you're here. Do you have someone are
you planning to walk us through this the financials on this or I am not OK is
someone going to or.
I will turn it over them and be handy for any of the questions. Below
as as alderman Vollmer explained we're particularly interested in are excited about
this project because it takes a piece of property that Alcee or a has own for
a number of years and provides an exciting new development at this location. We
have had
a number of negotiations particularly with the comptroller's office on this project
and I think everyone was agreed upon the tiff amount but what was
decided was that. The entire tiff would be annually
collected and put into the special allocation fund and ninety percent of it would
go to pay off the tiff no US but ten percent would be rebated back to the taxing
districts including. The city of St Louis so that's
a new wrinkle that this one has that other tips have not had and
the other thing that we were the Comptroller's particularly interested in but we
were very interested into as again the alderman noted is that the dealership is
currently located on South Kings Highway and the owner the owner
group of that property along with Jay Ackerman are going to use their best
efforts to backfill that property with another dealership and they have already
applied. To
a couple of possible dealerships for that and. You know I hate to interrupt but yes
you standardize this stuff I'm going through here and this tells me absolutely
nothing. About. You know I mean they've
got the financials I mean it's just. In my the only
one who can't figure this out. What what what piece are you looking at the there's
we have. This piece here which is the application now and.
You have anything that is tells us how much to tip amount is how much is going to
come in from different sources and uses And you know those are an actual cash flow
analysis farce and. I mean I was through this at the tip here and you know at the
preliminary hearing with everybody but.
Which were is it that I don't know if you have what I have. And I guess I'm here I
guess that is what you have. Been the moral.
Standard mine. Is it.
Again your. Development cost OK.
But. What.
You mean would be helpful if this was
a OK So this is where the projects going to cost almost eighteen million the TIFF
is for right your point or million it right to proceed OK so the four million.
Is what the public is going to be giving up or are this exact her act and then
where is that money coming from. Then. Real estate taxes well comes from the real
estate taxes and half of the eats in this case as you know or how much real estate
Well the real estate taxes are going to be zero because the city you all on that is
Acker act right now we do so there the real estate taxes.
The base here it's
a zero. So do we are much every year is going to go in well I'm sure there are
a number somewhere I do not have those in front of me. And it was or any
OK we were going to need to standardize this stuff so between now and the next time
we have one of these things we need to have. All of them come in here looking the
same way so that you know we're not fumbling around I mean we should have
a year by year cash flow projection that breaks all this out that shows the
coverages and you know this is just. I mean well that is all
in the. The document that was provided for the fifth commission but I did I lay out
at that in fact was yeah months ago yeah and none of these people suffer me no no
they they are not saying that so you know it's just not fair I mean there's either
was
a cost benefit analysis prepared which is always right in essence that that needs
to be at this meeting to OK going OK
OK OK.
Let's try to figure out if we can understand what's going on here So currently
there's no taxes being collected so why have zero in the base year do we know what
the attack real estate taxes are going to be every year that. Well I don't do know
what the debt service is going to be on the four point four four million.
I don't know if you have that. Hospital by my name is can't Evans I'm with Intel
a commercial real estate and Ackerman is our client. I've been trying to figure out
here for weeks what we need to bring and I apologize that we don't have the
information I do have all of the original. Presentations to
the board and we can walk through those if you would like. My understanding was
that. I mean there's obviously
a year by year analysis of the cash flows what happens to them and if we want to go
into that type of detail we can certainly provide that. We need to have
a public hearing today is that right and then we need to know what's our timeline
for what's your timeline for getting this out before we go down is here is there
are deadline or anything that we're concerned about meeting.
Mainly into
a Friday morning meeting we'll consider this heard today then and then you know if
we need to go ahead and start holding stuff up to get the right information over
here I've asked for cost benefit analysis on
a number of times and I can't remember asking every meeting but Situation B.
My job they ask for the same stuff every you know every time it should just be here
and we ought to be able to take
a look at the numbers and they ought to be in the same format for meeting to
meeting to meeting so that we don't have to go through this this is like. You know
. This is just I mean this is this is like we're supposed to rubber
stamp this I mean there's just no detail at all in any of this stuff and. You know
if any one of my members asked for more detail they're entitled to it and they're
entitled to the same information that the commission and the pre-hearing are and
you know this is just you know an adequate. So we'll consider it
let's stop for a second we'll provide everybody
a chance to ask what questions about the the project itself the overview of the
project and then we'll have
a hearing on him. So we need to get it out on.
You do hear it on
a second we could. Second rate it on the second second which is
a Thursday. And then we could go ahead and.
We could perfect and third read on the ten. I'm not going to be here this Friday
otherwise we can go ahead and do it right you want to go ahead and you know.
You want to do it this for I'm not going to be here this Friday but you know Ford
Yeah OK we'll go ahead and well I'll delegate it to my. Table body.
Vice Chair to have
a hearing on Friday morning and. Nine o'clock in the morning and.
We'll go ahead and pass it out on hopefully will pass. Muster to we need to get
a judge I won't be here Friday morning at eight thirty I already have another
meeting scheduled you hate to say this but we've already had four amendments to the
calendar this week. This will be the fifth amendment. It's hard to do
business when Brett I and I appreciate your comment although one.
Would be other members be available on Friday at nine o'clock right through the
session. It's not going to warm up
now. All right well then we'll just go ahead and we'll plan on on boating this out
on Friday we'll have opportunities ask questions today.
That does I don't know where we go with this. You know.
Why don't we go ahead and will provide everybody napper to go through this then
a good go ahead OK walk through that they'll. Have to do about.
What to get in my belly but we have all the detail you would want and I can divide
it by email if you would like. The. The beginning of
this project started because Ackerman toilet which is located in the city and has
been for thirty years has is it is in jeopardy of losing its dealership they can't
service certain models they are not provided those Toyota has told them find
a site. Or. You know find
a site move or we'll figure out something else so. The issued the challenge
there was is that toilet and now requires about four and a half to five acres and
a fifty fifty thousand square foot building with certain service bays you know
siting in and. So we started off looking everywhere within the city
and there were no sites that matched that criteria the Hampton site was interesting
we came across that and it was interesting because it had
a lot of fall to it and we thought maybe we could build the parking structure again
the extra acreage that was required and and work with it there so that was then
presented to Toyotas
a concept Toyota said show us how it might work. If we engaged an architect and.
And at that point. We came up with an idea we've been and. It was
discovered that this is this is actually the current. Building.
Process that we went through it's been. There vagrancy they're broken windows
broken glass. First half.
And so.
Well.
Here. They're. All.
L.C.R.
a Bought this many many years ago. Because they thought it would be the genesis of
a larger retail project and. Turns out that the physical
impairments that we've run into. Has also been discovered by other retailers and
been fully exposed to the marketplace for the last fifteen years.
But most major of those impediment is this red line here which is the thirty foot
water main and it means that it divides the site into
two areas. And you cannot build over it. And you're
basically stuck with
a certain certain type of building. And. So.
This drawing here shows what size building would be needed and the parking and you
can see it overflows the existing site and does not fit.
This site drawing shows what the toilet
a dealership would look like get it onto it and architect is come up with
a really really creative way of utilizing that water main as
a ramp so that it's
a structured parking and you can drive on the water main as it ramps up to get to
another level of the dealership. And that's just that's just.
A lower level picture of it and. That's what it should look like at the end that's
the concept looking east and the off ramp is on the right side.
So as far as the. Economics of it. You know right now there's
zero property taxes being collected it's been that way for many many years it's
been exposed to the market for fifteen years we're not the first to look at it.
A number of opportunities of. I think and presented their past
because of the impediments there's probably not any other views that we can come up
we deal with retail and office and. You know warehouse this isn't an office site
you can't surround it with parking you're going to have to have the parking down at
the bottom of the hill. There's it's very difficult to deal with eighty eight and
accessibility issues because of that. So
a lot of the parking structure is not used to service like an office point tell
would be coming in and out every day but it's inventory related because Toyota
requires that which was another pathway we took we looked at downsizing look and
putting some of the inventory on
a lot close by that is not the way it has parameters here so.
As far as the economics. What happens here is that.
This goes from
a nine tax generating. Piece of ground and decrepit
building do something you're out here instantly puts thirteen million dollars back
to the taxing districts. And so just by doing the test
over the tariff period of time. It generates thirteen million dollars and put that
back in. So there's in addition to that.
Ackerman is currently at about forty employees and they will grow
to medium please. And they are looking at back filling
the existing dealership. With
a dealer that would service that they could service with the smaller service bays
and would be something like a Hyundai I or
a key and they have put in applications but that's also it takes it
takes time and it's it's not certain but if you look at the
employment there it would be similar to the point at the current Toyota dealership
so moving here. Is going to double the employees go from forty to eighty and then
if that other dealership can be obtained there would be another forty back in place
so.
You can. Are there any questions Alderman Bosley.
I don't. Know I don't have any question
a woman can that present moment Conway's not only one Christian have any questions
. I do thank you Mr Chairman.
Do. Does Ackerman already own the site the M.S.D.
Site no it's under contract and. We're in our second extension period
and what are they paying with them pain L C R E I guess they're buying the site
from L C R E correct and what's the purchase price it's two point four million
which will go to all C.R.A.
It pays off the debt the L C R A has and so I mean that's
also another benefit is that it frees them up to utilize that for other
purchases. Maybe. Dale or somebody could
address as why does L.C.
Already have two point four million dollars with the debt on this property that
came from M.S.T. . Is that where it came from Otis M.S.D.
. Originally about twelve years ago when well whenever it Misty decided to
move to the new location. It was felt that the time that we would consolidate the
street department site the M.S.T.
Site and the image of the operation site. Into
a twenty six acre potential large retail site and so we were seeking Ikea and Bass
Pro be
a couple other larger entity we wished we later obtained I care about at
a different location right but we were looking at how to and then I was some very
costly. Actually used to relocating the street department so our first
thought at that time was not really come to fruition and so at this point when the
building came available back then we then purchased it from
a mistake so as on this point what we've been doing is really paying interest only
and who holds the note does M.S.D.
Know we do without any with with enterprise bank with a bank OK So M.S.D.
Got. Two point four million or some different amount it was in that in that range I
think it was about two point three something. OK So we still owe the principal
amount but we've been paying the interest on that through some general operations
or whatever you call it so really we have more into it than the two point four
we've two point four plus the interest plus whatever it's cost us to maintain it
over the last great however many years and I think it was like it was alluded to we
have had this on the market now went once we realized that we could. We had
a better location for the I.P.O.
Whatever we start marketing and we had we had you know
a lot of people lining up to buy and I have
a lot of people so we had about three or four different bites but each time because
of the of a slope and the fact that this was a single
a part part parcel as opposed to being incorporated into the larger part of our
souls that we originally envisioned it became
a challenge and then the idea that the water main which was not identified
initially to us. And that we didn't know. What once we owned it we
realized that we had that challenge of well sure OK Thank you. A couple of other
questions maybe for the developer. So of the eighteen million dollars total project
cost two point four million is to acquire the site Correct correct and.
Be the Ackermann dealership that's on Kings Highway I don't know what word that's
And but fifteen OK. That Ackerman dealership is currently paying
property taxes I assume and sales taxes and in earnings tax and all that kind of
thing correct so the city will lose that. Because. They are
some of that unless you are able to get
a nother dealership there which as you said is not
a certain thing so the city's going to lose that revenue and then the new revenue
is going to go into the Tift do I have that right well I think
a more accurate way of looking at this is that. ACKERMAN hast to move.
And they had made it clear from the very beginning that they want to stay in the
city of St Louis and on our first run with clients we always provide them.
Other opportunities just to expand their thinking and in within those
opportunities that mean there were really wasn't anything so your point is we're
going to lose it anyway so the point now is maybe we'll lose it is accounted for
some of us there on
a revolving quarterly review with Toyotas. You know if it's if this does
not go through Toyota can say you're done and no I understand that. I get that
OK And so it's either between Toyota or St Louis County and this is the city so
it's going to it's it's more about retention and growth you know I understand that
I mean we always have that sort of threat if you will which ice if you don't give
it to us we're going to move to the county. And so you're going to lose the revenue
anyway so you might as well lose it and maintain something or some part of it in
the city I get that but what's interesting it's unfortunate but I don't understand
well and it's not so much
a threat it's just the view reality of what. You know that has been imposed by
Toyota No no I get it that and I But what's interesting about this is that if
you're talking about this is the ten percent pass through and so instantly there is
they move it's not like it's zero revenue base until the IF has been paid off ten
percent of everything is flowing back through to the districts Yeah no I understand
that which. So it's kind of
a ninety percent to fifty you if you want to look at it like that and yeah but I
mean I look at it it's like the city should probably do almost tiffs like that ten
fifteen twenty percent because that's what the city needs is revenue so but there's
a little but for question on
a tip right that says the development would not happen but for the tip so if you
can afford to you know you're sort of saying well we don't need the whole tiff we
only need ninety percent of it. And I get them.
What's the timing on the project it might be in here and if so I apologize I
haven't read all this yet. It's contingent upon Toyota's approval toilers
approval is contingent upon. Having this site.
And. And then after that it's immediate I mean we start on
interviews with General Contractors sub contractors. It's
really depending on when you start you know whether it's winter or spring or summer
it's
a nine to twelve month building process. So you expect you would be open within the
next eighteen months or so something like Oh absolutely I mean the other you know
Ackerman Toyota is very anxious about this because the king's highway bridge is
coming down in
a week and it is going to just destroy their business they're very concerned about
that so. That's another reason why moving towards approval and
gain approval here in probably be reopened by the time your move over to Hampton
though it's yeah well it's true and the rice is doing
a brain John which is you never know two years is what we've we have heard here you
know what it takes and you know their goal is to be open next year OK in the
projections that it's a four and
a half million dollar two which is around I don't know twenty five percent of the
total development cost and in the projections What year do you
project that the four and
a half million dollars would be paid off what's the payoff period is it the full
twenty three years it's the full twenty three years but. Maybe no better maybe
it'll be right and here's what's really peculiar about this is that big killer
sales cannot be part of the tiff. Right because they go back to
a day having to go back to the yes it could understand that if this were
a normal. Retail operation. Were then the
tip could be paid off just yet credibly fast what's happening here is that only
about ten percent of the sales that are associated with the site actually can go to
the tiff revenue in those hands because people live in the city of St Louis you
know those names only being on if it's only parts and service that's the only thing
here they can get ice and that can go to it so that that's about ten percent of the
overall revenue of this hire project here so it's. You know there's
a lot of other ancillary benefits which aren't there's no vehicle to show how that
nearly well here I'm I'm happy and I'm I'm happy that Ackerman is and proposing to
stay in the city. But you know if we need it need
a new car I hope we all don't have to drive to you know olive and whatever that
road is way out there way west county more Manchester and where where whatever it
is out there. Because I know that you know there aren't
a lot of car dealerships in the city of St Louis comparatively I'm sure that's
because there aren't as many cars being bought in the city of St Louis but so so
that that's fine.
OK thanks no further questions.
From can anyone on David on
a more orderly more appear I'm sorry all the more you have any questions. Right.
Out of them Davis. I guess so I made
a statement about you had all the cost analysis so I will be emailing those to us
right absolutely I can not be helpful so that we have an opportunity to review them
before Friday morning absolutely OK. And so I just kind of went through here very
quickly to kind of get
a better understanding from myself. As so. Purchase
price for the proper use of write
a two point four million just estimated development costs at this point to such
a point nine which is it will just sit eighteen million and artifices disses four
point four So the balance there for me is OK I don't have
a problem with that. But what are the things that I did look at is.
The opportunities at the project rock. First of all back taken to Hampton location
off our hands is
a good thing for the city. Because there wasn't anything else we could do with it
as it stands now. And will now have based on your proposed
actions in moving will have to deal with ships through this company instead of
one with the. Propose
a new acquisition or something else to like they're going to try and just to be
completely. Transparent about this Jay Ackerman runs
his company right here and he leases this land and building the Kirwan from
a family partnership OK And so he's
a partner in the land and building that he leases so when he moves to here he will
own the business and the land and the building and but that family
partnership has no intention of leaving that alone. You know just
recently they completed
a transaction with another dealership that. In North County and that's
a new site for send teams so you know they're there knowledgeable about real estate
and putting it back into action they've made applications for one die in Kenya but
that is you know the I've just learned
a lot about dealerships while we're going through this in it and it's just amazing
I mean they they are they operate entirely on their own schedule and
there's there's really nothing you can do other than just provide them the
information but this this has really been a successful location for
a number of years and it's just that Toyota has moved into
a different line larger vehicles and different service requirements. So
it could work for
a smaller line such as Hyundai or key and you know going on in the same way that it
worked for Toyota for thirty years OK well that I thank you for clearing it up and
that is a different world is very much like the N.F.L.
. They do their own thing their way but it's here when you deal with those
ownerships and so if I understand
a right you're going to double the number of employees at this new site Yes So you
currently have forty you're anticipating eighty Yes and. Whatever happens at the
site. All softies highway it will probably be the same number that you
moved over to Hampton correct OK so that's a plus an eighty employees
a file that works out that way correct OK. I'm kind of happy about the have to
side because we already have our savings over there and maybe it will start
a trend and we'll have another. Growth for dealerships in the
city which is desperately needed I did appreciate after I had to drive about my car
to help more of the dealerships come to is that that's all for me thank you.
All in French. Thank you. I want to ask you about this and maybe actually somebody
from S.L.
To see about the ninety percent versus the ten percent so ninety percent of the
tariff is going towards to project and ten percent is
a rebate to the tax industry. What brought about that. Special circumstances time
we don't usually have that. That was
a concern about the original percentage of the Tiffany So it was twenty four
percent and so our goal was to try and lower that down closer to something that was
more topical we generally use as
a guideline about fifty percent but we're the only jurisdiction in the region that
has that artificial ceiling. But so we we try and stay there at around fifteen
percent and so we were working with the comfortable as office who had
a real concern about that number and so this was
a way to over time to try and provide more flow back to the to the
city at an earlier time. So it's not here but maybe in the information that you
give us on Friday. Do you know
a comparison between that ten percent versus the lost revenue we do and it would be
in that information that that we provide you I don't know the exact number but if
you look at the comparison they're probably brings about down below twenty problem
. OK. And just to be clear so the but
in this is actually
a question for the. I can represent here so the South Kings Highway location that
you're moving from there is no solid tenant there for it now though so as it is
right now it's well Ackerman Toyota is doing business there right now but I mean as
you guys leave there isn't
a tenant lined up to replace you know there's I mean there's nothing there's
applications in the Hyundai And but those are once again it's just. You know
it's like. You know you got to have
a chair to sit down in before the dealership will approve it so right now the
dealership at this location has said. We like it but.
You know it's not necessarily available and it's not necessarily available because
of this process and so once we get through the process and we receive approval then
Toyota will I mean they could say no but we're not anticipating that they will say
no. They can you know they will. Hopefully approve this and then once it
you're able to move from then the other site opens up are ones who are able to say
there's
a specific date when they will be able to move but you know our hopes as as
you know in the real estate communities to also there's
a time period let's find the highest and best use I mean it would be great if it
would be a Hyundai or a key a dealership but if there's
a higher and better use that we can we can achieve for our clients then we're going
to look at that as well so you're. You're least you have
a long term lease on that location as how things I look Asian This is well I am
Ackerman Toyota is Intel
a commercial real estate client and as far as how the family runs
its business I've never even asked I just know that it's it's the dealership is
separate from the real estate. The man who runs the dealership is separate from the
family interests of the real estate that he pays rent but I don't know the details
of that. All right that's all I think you.
Owe him Carter. Yes this question this vote is and I'm not sure if it was.
I think that I heard
a lot of she may have mentioned it but so you said that we saw the bill for two
point four. Think that price is in that range and was there
a exact amount of how much we have in the in the property yet we know we can
provide that to you OK So thanks.
Element code or no question all or woman Spencer. Yes So my question is
regarding the cost benefit analysis. Since we have it in my
correct that we have
a zero commitment to keep the second the first to me the existing location
operational that right I don't know to my asking. What we
have is
a commitment to focus on trying to get it so Mr Ackerman personally indicated that
. That he really wants to backfill this but obviously he has to go through the
application process so he cannot provide a certainty of that so we don't have
a guarantee he just sent a case that it's a good site it can service
a smaller vehicle and that he would pursue trying to get
a backfill that's the only thing that we have at this point so with the cost
benefit analysis I assume that is to include. The loss of the forty jobs at the
current site when we're looking at the cost benefit of this proposal is that. It
does but one thing that has not been mentioned is the fact that we don't we're
doing and to support it increased sales at the new location along with the forty
new additional jobs there so we so and in essence we again.
It's not
a net loss for the employee kind of thing so the other thing is that. We
did speak to the fact that the cell types on cars go to the zip code and so where
they buy it was located but we anticipate more sales. Here at this
location and more service and part of the attraction is that it. Is located on that
car to as close to close by attraction so the analysis would show some of that. But
the thirteen million dollars in sales is not
a net gain because we were are be losing the sales at the current location correct
. I'm not sure that it's thirteen million so it was actually the revenue
projection done by development strategies and that was under the cost benefit
analysis and they show what the net benefit is to the taxing districts over the
lifetime of the tiff and so it basically says that if you do this to fast it
stands and in the sales come in as it as it sits there it will generate over the
life of the tear thirteen million dollars that these taxing districts didn't have
before but it's not it's not. An annual amount it's over the lifetime of that but
my question is as relates to the entirety of the city so with the loss of the
King's highway location I'm asking if that's included in the cost benefit analysis
there will be there's actually. It shows that there's not going to be
a loss there because this is
a much better located location there's sales you know projections that sales will
come from Illinois from West County that will be more on the path traveled for
people to get to work in that it will be easier for people to utilize it
is that answering your question. So we'll be
closing probably closing the King's highway location Well the kings there can only
be one Toyota so I just want to make sure that the closing of that the thirty
million is not just
a net gain that we're including in the cost benefit analysis yes yes that's that
that's that's where I have all those sales are going to move over and then look at
it. Then with my ADD my next question is regarding to the traffic circulation there
this is
a confusing intersection as it is right now will there be improvements to traffic
circulation specifically accessing the property by turning left coming from the
north side well you know it's it's an interesting question when and it is
confusing however. What I think we've all arrived at is that there was M.S.G.
In an office building in you know
a lot I mean the majority of that was arriving eight or nine o'clock and leaving
between four thirty and five thirty this is
a dealership they don't have while it's
a similar size building they don't have the number of employees that M.S.T.
Would have so the implications of traffic it will be spread out during different
periods of the the. The day and. With less density.
So traffic has been looked at as part of this yes OK Is there any signal upgrades
included. There are there are none anticipated things.
That's all for me Mr Chairman. All right woman green.
Thank you I'm going to preface this by actually saying my car is sitting at the
King's highway location at the moment. And and I you know I represent that area
and my greatest concern really is having
a vacant building there especially given that you know next door we have this
shopping area that is only fifty percent occupied at the moment and it has been you
know
a challenge to to attract businesses in into there and whether you know. Having
you know
a vacant property such as this will provide further you know disincentive for for
businesses to come into that area so I guess what I'm really looking for is
timeline and and clans to ensure that that is not sitting vacant for long
periods of time and what the commitment is to I guess what what's the skin in the
game how much you know and I I know that you so that you're representing the car
dealership not the family with the the real estate area of it but what I guess
incentive do they have to be you know looking for
a tenant looking for somebody to lease it well. I mean they
there they are they've told us numerous times they're very motivated they don't
leave land and buildings sit around. They want to put them back to use.
So it's sort of. Working on that is not something that you do until you have
a solution for the front end which is what we're concentrating on but you know
given that we've actually got the best of all possible scenarios because if we have
approval here then we know that we can move forward with the toilet approval get
the building plans done and then you know there's nine to twelve months of
construction prior to that there's all of the bedding and everything else so we're
accumulating
a period of time where they can pursue the applications that they have out there
and say we have approval and we have
a construction deadline and schedule and on X.
Date in two thousand and sixteen we'll be moving from here to here and this
dealership will be available so there's there's there's
a you know it's not like it's going to happen overnight and there's not going to be
in you're going to be starting from scratch we've got
a lot of time that's built into this where they're going to be working on it what
is the general timeline once an application say you know Keogh or Hyundai you know
accepted the application what is the kind of turnaround time for. You know
something died been asking somebody that in the very beginning how many and how
many steps is there to approval. There is no answer. How is
or is there a process is
a uniform. You know much like Joe was asking about here if you want to uniform
process. There isn't. They ask questions they do you answer them
they do their own demographic studies they ask you to do demographic studies what
is very valuable though in this is that Ackerman you've taken your car there
because I mean they're great at service I mean they are in I don't know if it's the
top five percent it's theirs there's very few They're in their level. Company wide
and that's why Toyotas working with them and in allowing them some
a latitude on the time frame because of their success over thirty years
in supporting the toilet
a brand. In my final question is and you may not be able to answer this either but
so if you know chiar Hyundai were to come in are they going to say well this
building doesn't fit our specifications so we're going to need to do all of you
know these these improvements renovations and then are you coming back to us saying
well we need
a TAF or we're going to move out into the county and. The interesting thing about
Kiyan Hyundai is that they don't have any city dealerships and so that's the focus
is to you know that when the time comes they Ackerman family actually own one
previously and. They were told that if they could locate one in the city that you
know it would be looked at favorably So as far as the you know what the building
needs to service it I mean they're looking at it that it's
a similar situation is like Toyota was twenty years ago you know it's smaller model
smaller vehicles they've got the correct size service space will they need to do.
Something that you know I mean it's anticipated that everything can work on
a in in you know normal market conditions. You know for the question thank you
OK. Any other questions regarding this board OK we're considered heard for
publication purposes and then we get the financials here on Friday.
Will vote it out. And please don't dump you this is
a reflection of it's just that we have asked for financial data in
a standardized format for these meetings before and we're just not you know and.
That's not a reflection I understand I'm going to close quickly we have
a company who has sort of past thirty years then in City of St Louis improving the
space where they've been sensitive been there. And they own the property where
they're at and I'm sure that they are and I've met with Jay and sat with Jay face
to face his family can't wait to put something else in that it is to their
advantage he wants to stay in the city he's going out of his way to find this
location the M.S.T.
Site working very hard sitting down listen to the architect the problems they had
to design this site were unimaginable it actually does not fit the footprint
but total was so impressed with the architects work and what this can do and the
location. This is an amazing chance for the city of St Louis amazing chance for
what's going to happen even right next door to my ward where your cars are
currently I remember that was Clinton Cadillac when I was
a little kid they ran out to the county it sat abandoned Ackermann Toyota came in
and made the most of the site I used to walk the famous bar which is not there
anymore by the site and what watch the Akron people develop this these are
wonderful people who want to stay in the city and I think it's our job to do
everything we can to keep this here so in closing I know our next bill is going
Pena bill for that I'm guessing your would like to hold that also to I'm sorry the
next bill I have got will gain your bills so even though it's all for those nine
o'clock Yeah I appreciate your time and your concern and I will appreciate your
favorite consideration thank you thank you all the men and again we apologize for
bringing you back Mr Chairman. I just want to sic couple things because I don't
know how many people know this but we have two families that I know are committed
to the city it's like those who deal in the automotive industry that this family is
one of them and the other one is the sugar family and if you've watched what
McMahon Ford has done and that area to continue to improve and enhance the
opportunities there I think this where we're going here and I appreciate it thank
you. Thank you all I mean. Why don't we go ahead and I believe the all of
the fifth is going to probably stick around for the presentation we go into closed
session so we'll hold her bill and provide the older woman from the six the
opportunity to speak I see our former mayors and their presence and their presence
today so. Thank you Mr Chairman and most of the committee I am
here today before you on Resolution forty one which is
a ten year tax abatement at thirty zero one Spruce Street. The former mayor Jim
kind way has moved his business from West pine into the spruce location A.C.I.
Plastics he purchased the property for one point three million dollars and has
already incurred approximately five hundred thousand dollars in construction costs
this area is located in an enhanced enterprise zone which provides up to twenty
five years of one hundred percent tax abatement where requesting ten for this
project if you're not familiar with A.C.I.
Plastics they are
a distributor in fabricator of plastic sheet products around the country and across
the world they've been in business for over forty years and their former site has
been sold and demolished to make way for an apartment complex. And with that I
would be happy to take questions.
He's. Christian all the woman groups and.
All them and more. All are woman
Davis. And French. You know so we're just trying to be clear so this is
a to do to. Term same tin your tax abatement
what are we doing here. But I'm requesting
a ten year tax abatement for the construction costs that have been incurred to the
up for the upgrades in the building which have been about five hundred thousand
dollars and in the next year or two they plan to. Make an additional two hundred
fifty thousand dollars of improvements to the property it was formerly owned by
Sigma Aldridge sits in an area that has seen
a bit of disinvestment over the years OK And do we have any estimate of how much is
the value of that to your tax abatement if. I don't have that information I can ask
Otis or Dale to step up here I know right now the property is assessed are at pays
a tax about forty thousand dollars
a year. So it would be at least four hundred thousand but based upon improvements
will be probably greater than four in two thousand but. OK no more questions thank
you. For make sure I understand you did tax abatement at what did you say what
was your question. The value of the in your tax abatement OK we'll see the tax
abatement will continue to collect the forty thousand so when you abate we continue
to collect that so it's the one on top of that so we'll continue so we're freezing
that amount and they will if the taxes were to go up as
a result of the improvements that's what we're for going in this in this case so
which I don't know. Based on.
The Cup. Well I
guess we always do an estimate of that value and it looks as if the money that's
being invested in the property would result if there were not tax abatement and
about fifteen thousand
a year extra you know additional being paid to the city so I mean if you if if that
is accurate it's always hard to come up with that it would mean over
a ten year period it's one hundred fifty thousand dollar. Value OK that makes sense
and the way I did the way I figure it and this is I think can see.
A big number is if you assume that the and the improvements are dollar per dollar.
And that's going to translate dollar per dollar in value which probably they won't
but if you do that and if it's commercial about two percent of that then and then
you multiply it that's kind of what I do on my back of the arm full of analysis
that that makes sense and so how much is the total project. It was one point three
million in the purchase cost and five hundred thousand dollars in upgrades with
look into the future additional money being spent so in this analysis if there's
seven hundred fifty thousand dollars and prevents two percent of that is fifteen
thousand dollars times ten years one hundred fifty thousand now that's assuming
that you're going to get a dollar per dollar in growth and value as
a result of the seven hundred fifty thousand dollars program that makes sense.
OK. Where we leave off Alderman Carter.
Home and Coke are. All there when Spencer no questions oh the room green no
questions. Hearing no other questions that you're all entertain
a motion that we recommend this out with the DO pass recommendation so move.
Yes I move that we pass Resolution number forty one out of committee with the DO
pass recommendation. She moved and seconded. Man
Kirklees call it wrong and Bosley. Killing. All the women.
All the more. I out of the fridge Carter Ottoman
Coulter I don't want to spend I want to green I German wrote.
Thank you Mr Chairman. A point of clarification for the Although this was done by
resolution because it was an enterprise zone or was that correct OK.
OK next board bill. Alderwoman Hubbert.
OK this is the N.G.A.
Itself get it OK. About one way yeah why don't we hold off on that for
a second then. All. Of them
went down. OK I was going to say I have someone on my tube but you will go and
will take your first go ahead.
Mr Chairman the members of the book
a committee this project is that two thousand and Washington Avenue which is in the
near downtown area is considered downtown west we have
a development project that is renovating a commercial building into
a mix use and I'm going to give you the pictures and some analysis on it as well.
The property was purchased for three hundred twenty five thousand the anticipated
construction budget of six hundred fifty thousand results five apartments on the
second floor the first floor will have commercial space eight off street parking
spots and they'll also be applying for store tax credits for the project I am
recommending
a ten year tax abatement and I think I may have mentioned this at the last
opportunity I had to present a project I have
a number of projects that are going to be taking place in the near downtown area
that has been abandoned for a while and you know we had
a lot of investment there I think in early two thousand and mid two thousand with
the Tudor building majestic stoves and all of that but we still had
a lot of vacant buildings. On Washington and on Del Mar and so this is one of those
development projects is going to enhance that area.
I'm sorry I don't have the sheet in front me how much as you said the acquisition
was three hundred eighty acquisition three hundred twenty five thousand how much
how much anticipated construction budget is six hundred fifty six hundred fifty and
it's going to be retail on the first floor did you say there will be retail in the
presidential on the second floor. It's
a very unique building too it's good to see that someone is willing to get that one
put back online. About all the men and.
All the woman person.
I have passed out my stuff to you so I think it's two sets of
a one each way and it has the announces they're on there for you. I thought of it
was NOT thousand right.
And so it's going to continue to be
a mix of commercial and residential It will be mixed use building. OK Thank you.
All in French. Thank you all and Carter OK
on quarter. What you think. You know for me
my memory fails me because the bill has been empty so long I don't even remember
what was there before and I don't know if you have records of what was there before
. You mostly stores OK because I had not thought activity there I know in fifteen
years. Alderwoman Spencer no questions
alderwoman green no less. And I have no questions the chiro entertain
a motion that we pass out toward Bill eighty eight with
a to pass recommendation. Move the second request
for previous role here no objection will consider board bill eighty eight heard
they can't thank you. And unless there's an objection from the committee I'm going
to go ahead and ask. The counselor who is now resident in my ward to step up and
explain board my board bill which is one hundred six which I think is mostly
a procedural housekeeping. With Chairman members of the committee what board bill
one of the six does it authorizes the city to enter into intergovernmental
agreements with a C. ID and a T.V. . The C. ID and the T.V.
Or the Hampton Berthold ones these were created to help assist the tiff that was
done to help them. Sadie's dealer interesting hearing all the car dealership talk
today. The this bill really is it's
a protection for the city because what happens is. When you do these tips.
They sometimes need extra revenue and the C. Idea and the T.V. D.
Are there to generate the extra revenue and the city wants to be sure that the
developer keeps the T.D.D. And the C.
ID in place for the term of the tiff that they keep the tax at the anticipated tax
rate and that they pay the money over to the comptroller's office so that's really
all this agreement is do is. Contractually bind to see ID and the T.T.D.
To perform those obligations. So we are talking about those tools earlier that
these are Site Specific T.D.'s and see I.D.'s so. It's
a car dealership so the car sales the taxes on the car sales go to the county.
To the to the resident county of the acquirer of the car as we discussed previously
so the city gets none of those sales taxes and these. Do not
apply to does not apply to the car sales but it does apply to other services to all
the parts are services that are current there so only the people getting their car
service that these at that location are paying those taxes and the fact that those
taxes are being paid is accelerating our at least servicing the tiff note that was
put into place to get them to locate there in the first place so does the everybody
kind of follow that. And this is. It was a point it was
a two point eight million dollar tip for a project that was about
a twenty million dollars project out in all this and the last and fifteen percent
of project costs. Are there any questions of. Myself or
Bill regarding board bill number one zero six. I guess I should go
through the list of. All the woman crews and.
All the woman Davis No questions in French of course over and order
a quick home and go car all the rooms been served no questions all in green no
question. It's your request motion for
a previous role army no I guess we need to get
a move that we passed out of committee and we've. Been Moved and seconded requests
for previous role hearing no objections will concerted board bill heard one of the
six heard and passed out of committee. Now we are down to.
The last of the board bills board bill one seventeen and now you're going to have
to help me here because we are going to get an update on this I guess at some point
but that would be after this is correct so.
OK why don't we go ahead and just stop for just one second before we take this up
because. While we're here in public session and yet.
When we sent you
a letter kind of asking you an update on the things that were underway and
a kind of commitment on when we would get our business plan and all the things that
you appeared in front of the committee last time and we had never gotten
a response back from that letter so. I don't know if
you were in
a position to comment on that today but if if you are great if not. Led to service
and reminder that we're waiting to hear back from you on our. Actions underway that
OK and then our committee had
a number of requests from. At our from our last meeting and forgive me there's
a lot of e-mails that were flying back and forth that people got copied on to
everybody get what they wanted one that you all did. And that's why I'm asking
now before we take this is are you people I get
a little fuzzy on who asked for was going to get what they wanted from either S L B
C R or C.D.A.
From our last meeting there were some information. That we requested on to pay off
notes and stuff like that. I got some information on.
On the commercial district that I need clarification on that I was going to share
with everyone it was there anything else lacking that we should ask about before we
take this up and. I'm going to see that
everybody.
That was on that. OK.
OK I I got some and I kind of skim through some of it and I get
a little fuzzy it's just the all the woman from the twentieth I know you had asked
for some of them I did and I was looking Were you satisfied with what they got back
to you with. I did not understand and that was my request was
completed and so at the end so I'm looking now to see it but at I didn't.
I didn't feel like Mary spoke quite right as I could have been I will be happy to
look later but I didn't feel it when I came into this meeting that my right request
had been completed OK Do you feel comfortable just follow. On Yes I do. If there's
anybody else please feel free to follow up on their own and if you're right I can't
imagine that you would have any problem getting information but if you aren't
getting it please feel free to bring it up at our next meeting. In this. Response.
OK So the request is that we get responses for the whole committee then. OK.
All the one why don't we go ahead and turn it over to you we'll take this up now
while we're in public session board bill number one seventeen. Thank you Mr
Chairman and members of the committee I'm here on behalf of board bill one seven
scene and what I would do is provide
a brief summary of it and then let you know if answer some of the questions and
then I can answer some to as we proceed into the public presentation of where we
are or with N.G.A.
The purpose of this bill is to facilitate additional funding for property
acquisition and other costs associated with this family of approximately one
hundred acres one hundred acre site for the Western headquarters of M.G.M.
. The bill accomplices that purpose through the filing first did authorize
a St Louis Minister for Financial Corporation to obtain alone in either the amount
of thirteen million and no other debt is refinanced as part of the loan or twenty
million of debt associated with fifteen twenty Market Street his refinanced as
a part of the loan. It also authorizes the assignment of the base lease and lease
on fifteen twenty more to shriek which is the office building is the federal former
federal able to build and city hall waste is what we call it and a permits
a mortgage to be placed on the fifteen twenty Market Street office building as well
as to other an incumbent city park because they're required to secure them while.
The portion of the loan directly related to the N.G.A.
Project will take the form of
a line of credit which will be drawn as needed primarily to pay the cost of
acquiring options that would be exercised only if N.G.A.
Selected aside some funds would be used to acquire property even on
a prefers to sale our right rather than Grant only an option to purchase some of
the funds also will be used for environmental remediation relocation and some what
cost. If N.G.A.
Selects the site. That S L M F C loan will be repaid through proceeds of the sale
of the property to the N.G.A.
Or a bond issue secured by one
a portion of the state income tax revenues generated by N.G.A.
Up to twelve million per year and to
a portion of the city earnings tax revenue by the N.G.A.
Of the one point five million
a year which may be allocated from Northside since revenue after the India
completes the project and takes I can see the state currently receives over
a million a year in income tax revenues from A.J.
Employees and all the women I eat dinner do we have
a deal summary on this at all. Is.
OK OK it's just these numbers are wrong by faster than I can keep keep up with them
. If
you like I'll refrain from getting into the meat of the numbers because it's
actually going to come up in his presence and. More.
So but the bottom line is this board bill is authorizing us to take
a loan out against. Against what the market property is that right Iraq.
You've got to have that you know you don't have. If you want to we can move
directly to that discussion if you like. You need to go in the close session now
than I think what I can do in the public setting is give you just
a little more background on maybe some of the acquisitions and then get to the
numbers real quick. But I do have. This. As real estate
so the cost. Part one of my consultants here is we've got
a time crunch and we can get right into the numbers and allow him to leave to catch
a plane and we would be able to stuff we could go into closed session that would be
very helpful. To. Talk about. The fact that the.
Right now so yeah so the question as to the status of where we are in the real
estate as opposed to the negotiations we could do in public but the reason I want
to go into private is to talk about numbers and some personality and I personality
but personal kinds of things that I think the board may be transactional kind of in
a fight and we identify addresses cost and everything involving in real estate
right you should not be doing it in public so so that's why I'm saying that we
point of order though if we are we discussing board bill one seventeen.
We can do that in close session right now I wish we. So so maybe I what I can add
is that I think we can discuss
a lot of that but what I would like to do as far as the financial part of that and
the trends action apart I'd like to be do that and close the transactional part
closed the session now and then reopen it is that what you're requesting Yes way is
that you time of the transactional part related to board bill one seventeen. Yes.
What I was. Really
like. Is because our court is going to stay bad.
I guess Initially the plan was to give
a provider of day part to us given the board B.-O.
But I guess with the tight time constraint we had to. Bump it all in one so I think
there is some overlay there there are some things we probably shouldn't be
discussing Do you have
a question that we go into closed session and then come back out
a closed session to discuss the board bill then is that I'm just trying to expedite
the process them OK I mean no way I'm OK with that if they tells me I'm OK with it
I'm not. You know ask for money I know I'm supposed to read something before I go
in
a closed chairman or do you hear me some point where. Yes but I don't even
know what the board bill I mean I've got in front of me and I'm reading it but
could we get an overview on the on the board bill we can do the overview first and
OK get the big picture before we dive into the details OK thank you both.
OK I mean it's kind of. Awkward to talk about it without talking about it because
that's what it's comprised of but. In summary I guess what this war bill does is
authorizes the city to use some point your resources that it may have to acquire
additional funding to do something do things that environmental remediation
relocation costs and similar things to get this site properly assembled for the
federal government and there is
a timeframe on that. The specifics of it is definitely in the
board be
a but he can give some over your background information on. How this will actually
be structured and how. Will utilize the means we have to acquire the additional
funding that's needed.
Is there any questions this time specifically related to the board B.-O.
As it stands.
Yet more below one seventeen.
Or would it be best for us to go into closed session let's take some questions then
open back
a little so that we don't need to go to both of you for me to discuss this. And if
you don't mind I want to. Go right to it. If you go to. The
package that you have in front of front and back and if you would just
a brief summary of. The milestone that we've covered thus far.
And sort of an update I'm out. This all began with the announcement by the N.G.A.
Back in April of two thousand and fourteen. So in September of twenty fourteen the
National Environmental Policy Act study. Was going to was conducted on
started on all six sites. And essentially. For the
for the sites continue to be in play two of the sites worry. Withdrawn
from consideration. Back in December of twenty fourteen the first public meetings
were held. On our site here in the city that were actually three public meetings.
So in August of this year and
a couple of months the results of that study of the draft results will actually be
published by the G.A.O.
And by the Corps of Engineers it will provide comments on all of the site and so
they will also they will then again and September of this year start
a nother public hearing process for each of the four sites and
between September of this year and March of next year. The what I call the
problems that may be identified with each of the sites there is
a time for cure. So the March to June twenty sixth actually is the
process then actually we expect sometime between March and June of next year that
will be complete. As you remember in March of
this year the board passed board bill two sixty three that authorized us to
commence the acquisition and
a stipulation that we come back to the board if we need
a domain come back to the House committee and to the board. The good news is that.
Following that we were able to coordinate
a negotiated with the with the state. For the legislature to pass the House
Bill five fourteen and the governor subsequently signed it just
a couple days ago and in essence give you
a summary of what that is essentially. Later on in the presentation so in March of
two thousand and sixteen
a final psychoanalysis will begin and be part of that decision process and it
consider the things that are listed there so between March and September they would
then do a final site selection. And then offer
a purchase agreement for us to review and agree to and. At that point we would then
be able to start once you're designated You can then you have about
a year to get the site ready to turn over to them for. As sort of an
unencumbered title and that would be March seventeenth. So the next slide is really
a summary of the ownership that we currently have on the site you can see many of
you probably follow yesterday's actions by the court by. Foreclosure process.
So we originally had three eighty two here for the number that was owned by.
Generation that now is three forty to forty of the properties worse.
Or close down yesterday and current. You know in the ownership of type fish you can
see that the other. Properties there are sort of categorized you see one that says
eighty one That means there are eighty one separate. Property owners at home one
property and the overlay here shows that there are really what we have five hundred
fifty parcels in the area there's really only one hundred and nine owners that we
are dealing with. The next. Slide that shows by property
type. What we're dealing with here primarily vacant lots the seventy percent
of our vacant. The next largest category is sixteen percent. Or
residential. Properties that weird that we're dealing with and you can see the make
up of what the others look like and so the key here is I want to be sure everybody
understood is that on the very next slide it talks about the acquisition process.
And the acquisition process starts with the title search then at that point we
notified the property owners letter was sent appraisals watered and
received. A second letter was sent with an offer and there was some confusion
about there being just ten days for people to really make
a decision what that meant. In essence what we were hoping to have is just
a response and then it we will follow up with the negotiation with contact and so I
think we've been able to clarify that with
a number of folks. The negotiations process is underway and then
we would then move to having people on the contract. The acquisition status which
is the very next page shows where we are in that process we are at the negotiation
stage with almost all of these parcels. Some of straggling because of various
things that we have to work through but you can see the status of where we are at
this point. So just a summary of
a state legislation that we currently have. It allows the state acting through the
Department of Economic Development. To work with the city which in
this case they all C.R.A.
To enter into
a financing agreement to retain employees the legislation just basically says two
thousand and geospatial but it pretty well specifies. It's specific in the sense
that it needs to be at least two thousand and well used. In the intelligence field
financial agreement with the law for their procreation and disbursement for up to
thirty years of state tax income. Tax let me just interrupt they
get by by city ordinance we have to keep this they have five more minutes on here
so we may interrupt you couple minutes to OK after our Hotshots. So in essence
it was inferred earlier that the state currently the state's withholding tax is
collected and in the amount currently by the employees by thirty one hundred
employees they are now amounts to about eight and
a half million dollars between eight and
a half million dollars. And so. The States has seen fit to
appropriate up to twelve million dollars per year. Of their withholding tax
from the site and the way they came to that number is that there may be. More
employees that may be included in this later on and also inflation but we do
believe that the negotiation piece of this will start of
a different level. So additionally we will get the brownfield tax credits that.
We get that either way. The state. Commitment is only based
on the site being selected. So on the on the next side is really quite. We are
asking what they all the woman to refer to in the board bill. Is
that the state would really like to see the city commitment to this as well and
so. Our puzzle is that the site is in
a. In the. Chip area which would require that fifty
percent of the earnings taxes would be devoted they are you anyway and so at the
state they were if it was selected and once the site is occupied fifty percent of
the earnings tax would go into the special occasion fund anyway and so what we are
asking is is that. There will be an appropriation that will begin now spent of
a. Where we just pause for just
a second to change the table take the. City ordinance were acquired to record these
and price them off them.
Yes.
OK we're. Already. OK. So I
was explaining the one point five up to one point five. And clearly
right now the earnings potential I mean the collective earnings tax is about two
point three So we're also talking about this actually starting from a base
a little lower than one point five but being able to potentially move up to one
point five If in fact we gain more employees or through inflation over the over the
period of time. So the state's commitment is for
a. Thirty year period and so we would look for
a companion timeframe for him from the city as well. The board bill would authorize
the municipal finance corporation to obtain
a loan. And this is in the amount of thirteen million if there is no debt refinance
or twenty million dollars if the. If that is associated with. With the fifteen
twenty market is refinance if the debt associated with fifteen market fifteen
twenty market is refinanced as part of the long it will be twenty million.
And if there was
a need to do collateral then it would authorize the use of the three properties
listed as potential collateral and it's fifteen twenty market in one thousand nine
hundred Hampton and fourteen fifteen. North thirteenth Street.
And sort of a summary it authorizes they'll C.R.A.
To negotiate into if I enter into
a financial agreement with the state by the state funds will be capped at twelve
million dollars But where they initial contribution from the state will be much
less than the twelve million the cost of based on the current employee withholding
taxes. And the city contribution will be from the earnings tax capped at one point
five million and the funds initially from tax revenue generated from the current
site and then followed by the allocation of the Tiffany from the local to district
. And so I want to end by just going
on to what the own going actions are. Currently. We are
having discussions have been negotiating with the utilities about the abandonment
of rerouting of all the utilities their design of that is already committing for
a schedule. The. Department of Natural Resources has appointed
a project manager who is working to work with us on the environmental issues we
hired a project manager in W H who is coordinating
a lot of our efforts to include master planning around the site in
a facing with. A company called Urban to design associates who is been hard by
the choice neighborhood effort to make sure that I efforts all coordinated so the
choice neighborhood effort being led by McCormick bear and C.D.A.
. And for the housing folks that all of that is coordinated that the utility
Vandeman and relocation is actually coordinated and the street in Alibek Asian will
be coming back to the board obviously to get that get those done. We are
big having discussions with the state and that is ongoing and we are continuing to
coordinate the financial support and all of the acquisitions so those are the
things that are currently ongoing and I'm open for questions except for if we would
if we have
a specific question about finances I'd like to move into executive session to cover
.
Are there. I guess what we'll do is. See if there's
any questions now and then well I wonder can emotionally go into executive session
and then. So all the women crew some do you have any questions part of us going
into executive session I do my questions are of an overall nature not any specific
negotiations. Is the board of Alderman authorized to mortgage city
property. Any time for any reason or I wasn't aware that we were
but. From
a legal perspective defer to the lawyers. Mark Green with yes
the charter specifically authorized the Board of Aldermen to mortgage city property
. Goodness. And the that's interesting. Well maybe I should say
but you can't Yeah I mean and that's that's not uncommon among charter every
charter city in that in the state has that power and so it's not it's not uncommon
the I should say that you know and i Beacon can speak on behalf of the municipal
finance corporation but the meanest parents corporation does financings all the
time were that encumber city property that's frequently done through long term
lease agreements. But charter doesn't allow it and in this case.
The board it's been requested that the. And that's one of the reasons that for the
board bill is to request that. This will announce corporation to have that power if
needed to secure to suit to secure this obligation as opposed to the.
More common long term lease agreement which gets you close but not quite the same
thing. Who is the municipal finance corporation. It's not got
a name or it's just
a list Minister of Finance Corporation Oh no. This
isn't. The St Louis minus the answer Corp is
a five hundred one c three organization that is used to borrow.
Debt on behalf of the city with an asset pledged I am president
of the St Louis Miss for Finance Corporation and there are many of our in
cities around the city indeed that are. Improved via
the St Louis Miss Finance Corporation including fifteen twenty Market Street the
jail cross the street the justice center Civil Courts Building. We
have done the parks deal nowhere Thank you yes many of them and in this case what's
important is that. While Otis indicated there might be
three parcels of land for collateral we've got it down to just one
and fifteen twenty market is going to be the only piece of collateral
needed for this financing and. Peter had to leave but we've been working on
this you know for two or three weeks
a year more than that how about six or seven Anyhow we have a center kid we have
a syndicate of local banks. Enterprise bank. The
full bank and Pulaski bank. And as such they have allowed us
to do the entire financing which which includes the.
Six million to take out the current debt on fifteen twenty Market Street
and the other thirteen million and on top of that. You know the interest rate
we've negotiated
a very good interest rate so the debt be lower than what's in there now about two
point nine percent on the six million. Now the other part of it will be about four
point two five percent and that is the the thirteen million but that's
a taxable rate OK and the spread between the two is normal about one hundred
forty basis points but what is most wonderful is that this syndicate has allowed us
to be in the position to borrow on
a parity basis any additional dollars that we need for improvements to fifteen
twenty market. Over the years if such needs do come to us
I.E.
Another department must move into fifteen twenty market we must build out that space
we must further renovate restrooms except where they have allowed us to the
ability on
a pier eighty basis to bar what is needed we do not have to worry about whether or
not we have the acid because the acid there they have simply said that they will
give us first right of refusal and they will give the first right of refusal I.E.
That means that if we find somebody to give us
a loan at two point two percent they've got to match it. Or you know we move
on
a two point two percent so that is very important to this city because that has
become
a building that is utilized for many departments and there is more room to build
out and we need to be in
a position to make improvements and move other departments in the building even
though this is part of this transaction. So thank you Ivy OK that's very
helpful. I'm glad to hear that you're the president. Yeah I have.
A couple more questions. There's I don't know five hundred fifty one
properties if I added it right I added OK when one of them happens to be
a. Billboard But so we're talking we're talking about really five hundred fifty
really. Really can do I remember correctly that well of the three
hundred forty two properties currently owned by Northside regeneration plus the
forty now and by Titan fish of those three hundred eighty two properties we
meaning L R A or whoever it was sold
a lot of those properties to North Side about right about two hundred and eighty
about two hundred eighty OK and. I notice that
most of the properties are we have to negotiate with them four hundred eighty eight
of the five hundred fifty one properties we're going to have to negotiate with the
owner don't talk about specifically about that negotiation but isn't there
a limit in the board bill we passed
a little while ago that says that we can't. Of the two hundred eighty eight eighty
properties that we sold we can't. Pay him more than pay north side more than
fifteen percent more than what we sold it to him for something like that you know
remember I I'm not positive on that. OK I'm
not sure that that cap but we we are very. Mindful
of what we paid what they paid for the. Good.
Old US I really appreciate this summary it's it's very helpful this is
a complicated. Transaction. It
looks like that if we are able to get in GA to stay here in St Louis
that we will be giving up I think all of the earnings tax No I
just wish we still talking just just there is just
a half so far for this but want the other half go to the to if no it will not
that's what this is this is what this bill what Bill will redirect what would have
gone to the test for use in this financing OK. Thanks for that clarification so
of the two point four whatever it is right now that we're collecting from earnings
tax on N.G.A.
Half of it would be used to pay back this note this twenty million dollar note how
does the fifteen million dollars that's currently in the bond issue that's before
voters on August the fourth I think it is how does that fifteen million dollars
relate to this twenty million dollars Will we use that fifteen to pay this offers
that fifteen million dollars is
a separate the fifteen million was focused on infrastructure infrastructure for two
cargoes Cass and Jefferson interesting I mentioned earlier that we have the choice
neighborhood after also going on going which is also focused on those same Cravell
what I'm such a choice neighborhood it is
a sort of like I hope six program but they change help six to choice neighborhood
and and so it helps with the improvements that with then the neighborhood but
we which is why we have this coronation going on between our consultant and the
consultant for the. Group that's doing the choice neighborhood so that we can sure
that we have coordination there but it's really focused on those two cardinal It's
a street improvements. It is what all that right and and hopefully I don't know if
this would be the case that fifteen million dollars you would hope could be used as
a match for some federal funds I mean especially since. You know this this now is
a such
a we will be seeking all yes I mean the federal you ask your question is YES HELLO
the federal government is. So as always we might be moving out and now the folks
who work there who are going to have their. You know some of their earnings tax and
some of their I mean we're all having to pay to beg the federal government to keep
N.G.A. In St Louis I you know. That's
a very unfortunate situation for the federal government to put us in. So that's all
thank you.
All of them Davis. I.
Wanted you to I think my question really should wait because it's dealing with the
. Real Estate Finance. But I do want to just ask you one question here
or. As I was reading through this this is the operating agreement for him in
this process but. The public Financial Management Inc
as being referred to as
a financial adviser is that different from the St Louis miscible Finance
Corporation Yes that is you know are you referring back to the previous bill. I'm
reading this out of boredom number seventy is that the explanation for the purchase
agreement and the process I may be part of the they are that they are an advisor to
the to the as advisor to the comptroller OK. OK
Thank you. That's it for me thank you.
Mean my list here we go. Alderman French
Thank you Chairman. Owners are
a lot of questions here and the main one in this is the one I keep asking here is
how much is project cost him I'm going to get to that I'll give you the sheet here
and tell you you know in a second when the session. That's
a that's
a public question OK so that I can give you the total and we could talk to the
Pacific's if you like yeah how much of this thing cost us so. Currently we have in
the total sources one hundred thirty million dollars.
Hundred thirty million right. Now that includes the money that the states put
in that goes the money that's everything yes. OK And that is
to retain how much in earnings tax because we only only revenue we get from the
N.J.
Project or in GA It is earnings tax right now and that's about two point two point
four currently with thirty one hundred employees or four million annually that we
get now now just by relocating it to this location though we split down half.
Under the current law on the current law under current law we spit in half so we
already reduce our intake to general revenue to one point two million.
And we're going to spend one hundred thirty million dollars to retain
a minute of that the bulk of the benefit also is to the state where they stand to
lose eight and
a half million. If it chooses not to be in Missouri. Eight
and
a half that's current with the current employees that come from the state withholding
taxes for the employees based on the thirty one hundred employees time seventy five
thousand average average salary time the the rate that they use for withholding OK
So my question so we're going back to your timeline here when we passed.
More bill to sixty three back in March right. When you guys first came as talking
about acquiring that land over there that property one of the questions I asked it
was how much was going to cost and I think the number was somewhere around six
million or something to acquire all that property you say that Well I think in
later you would say that that did not include the businesses right after we passed
the bill. Well I think the question at the time was about. So much focus on
residential and particularly Pacific Residential efforts and so we
that was I believe we answered based on one was residential one was business and
then there was total acquisition of the businesses and I think you know we talked
about that around forty million dollars to forty million dollars And I said in that
committee hearing and I remember specifically there was afterwards when we did some
more research and there were some more articles written but they detail the
businesses that exist in that area and especially some of the biz rights they had
already made some major investments we gave them some major incentives use in
previous years and so those businesses alone were going to cost more than the
number that was quoted in the hoods commit exactly and so to answer your
perspective we asked
a. Period of time but this has been an evolving process and as we learn more we
have been able to refine those numbers and so we you know we're sharing them as we
as we learned more OK So yesterday development in this entity tightened fish to the
L.L.C.
First do we have any idea who they are. We know who the people are that are representing
them yes do we know about ownership Yes This gentleman named Joe Camel and he's out
of Kansas City he's in the Kansas City area and that's sure if he's in Kansas or
Kansas City Missouri but he's in the Kansas City area S.
So how much he pay for those forty property yesterday he paid three point two
million total you're going to million. OK so it just happened yesterday but it.
I guess negotiations in that begun between
a city and trying to purchase not. OK so the two to three hundred forty two
properties that remain in Mr Miki's possession. So when you go to
the slide here of acquisition status. Why aren't
those already under contract I mean that we already have
a relationship with this guy they've been going on for months while we are having
those discussions but we are having this questions about about price.
Is he actually playing hardball with the city to buy back the bow no no we're just
we're just having discussion at this point OK So because I mean I think anybody
else would see is that that would be the easiest one like from where you presented
as
a partner kind in this thing he wanted no no no no this is this is. Acquiring
the properties from him as
a one of as one of the one hundred and land owners and so that is strictly where we
are now he you know he has
a development rights for the area outside of that property and he will keep you
know he's continuing to try and do things there. So to this specific deal
for Bill one seventeen. So the total amount. Is
up to twenty million. Yes and we would borrow. And that's strictly
for land acquisition. That was
a well if there were several things that work order their land acquisition or
environmental remediation relocation similar costs OK.
And in order to borrow that money. We have to mortgage up to three city
buildings to do well I think of clarification that idea in
a case just one at this point so one of the other two in the bill. Out of time that
we started this process I think this is where she is telling us later and later
from an alderman friend when this was started about six or seven weeks ago we were
starting to go through the various banks and as it turned out we ended up with the
syndicate that I mentioned before private bank and steeple enterprise and
Pulaski and they were happy with simply fifteen twenty market
and with the console and I didn't want to pledge other piece of the collateral
anyhow so we kept working it so only fifteen foreign market is involved.
Not nine hundred Hampton not fourteen fifteen nor thirty three forced
to do so with a B.
And and amendment proposed because those three properties are listed in his board
bill. So. If you would like to make an amendment that would be fine with us
because we only are using fifteen twenty Market Street. And
and as we said six million is outstanding on that building currently that will be
taken out with the syndicate and then you have the thirteen million that is
actually being borrowed or
a line of credit. For the acquisition so let me through that again so right now
there's we owe on on fifteen twenty market yes we'll how much about six point six
million OK And so what is the deal. With the syndicate. We will pay that off
with them and the news broke out they are the three the banks they are the
syndicate now the boy they were working with. Two other banks couldn't get couldn't
get there with us with our terms on collateral except for OK And so they are not
part of this syndicate buying the debt and when they will of the Senate get the
syndicate is taking our out six point six million that's right there were so and
because it's really another entity that has that debt now J.P.
Morgan So they will take them out we will not be Morgan anything OK But so
then because right now the building is pledged with J.P.
Morgan you know because all municipal finance corporation bar we are leverage to
borrow
a car so we can and we refinance it with them so then we will owe them then the six
plus the thirteen are yes the thirteen is being taken out for the site acquisition
are you saying thirteen this is OK So thirteen as with the refinancing I got
six point zero we will actually over that syndicate eighteen. Well actually say
things are six plus thirteen it's closer to ninety one thousand six that's why it
says or up to twenty million OK Yes All right.
And it'll only be that building which is wonderful what are you that building
that's very good we believe it's about thirty million thirteen or fifteen thirteen
market not fitting to market up thirty million and work we actually have ordered an
appraisal this week and we will have an appraisal current appraisal of the building
because indeed we have upgraded about eight restrooms there in the last. Two three
months and so we are getting
a current appraisal of the building so that some it's not common though that we
mortgage city buildings on unrelated projects. And yes we do we do don't
want to start talking how many we have them or not yes the convention center has
been more good and from the convention center series two thousand and ten
a. Lot all
a lot of the city streets down here in and around convention center. Most
definitely were done by leveraging the convention center and then getting other
dollars you know to fix up other parts of the vicinity in and around it so moving
out the vent detention facility very similar situation and it's
a way of not going to the voters were doing very much needed capital
improvement in and around that facility the convention center streets leading
to and around the convention center but my question was is that we don't often do
that on unrelated projects so this isn't were mortgage and something over here to
pay for something over there understand we might do it surrounding I know one c
three server allows you the ability to do that i do we don't do we do it often is
a rare thing to me I've been doing it for twenty years you know because when you
start looking at you know some of the associated projects that we have
leverage city buildings for and I've mentioned some This is not uncommon.
I don't mind just making of course and for that. He is an attorney who does
understand this and the law. He isn't.
And so the. So the full faith and credit of the city of St Louis it wouldn't be
enough to borrow that for that land acquisition Yes well we're not trying to that
even though it's an up and appropriation backed. You know debt borrowing just like
all our other in other words we get to come to you every year put that. Right
just like you have on Convention Center Carnahan court house justice and civil
courts thank you for spark all those. Tests to the budget
of the Board of Aldermen there. And it's you know it's appropriation back
as opposed to just. As we would have to do. And go to the
voters. As answer around the voters I got Yeah well if it is the way the
city has done. OK. Or no other questions at this time.
I'm Carter. You know I don't have that many questions I just. So
we can only access questions within the bill right. OK. And so in here.
Create Jobs Fund all that's already created I think we created created that with
the initial bill right. OK so what what what would be the purpose for the
N.G.A.
Job fun. And how much would. Be put into this fun
out of the one point five. Million funding status.
What page or your. Page six. Page
six and one twenty five. That's just
a clarification as as Mr Williams said that the fifty percent of the earnings tax
that otherwise would go to pay to freedom project costs so this is taking that
fifty percent and just segregating it into
a separate account of the special occasion find to make sure it goes to pay for
this debt and not other Tift debt OK so I guess it was in
response to all woman crews and question about is this capturing hundred percent of
the tax revenues in that if no it's only capturing that fifty percent going into
a separate account of the Special Education Fund to pay this debt right and. With
all the except in one point five million of their earnings tax How long would that
and would they go on to. Some. Companion piece to the state the state's legislation
is thirty years. Also thirty years yes OK.
That's all I have
a big. Order. All along.
Yes I have
a couple questions thank you Mr Chairman so this practice of mortgaging buildings
you said it was
a common practice and you mentioned the convention center do you have other
examples. Yes this is how the
city has been borrowing to make capital improvements on its facilities
and it does include the convention center being the largest says the
Carnahan courthouse we made improvements there when we were essentially almost
given the property by the federal government the civil courts building we
built the justice center from the ground up in this manner the
juvenile detention facilities prove mints were made there
we leverage that building. Force part. Sure it
was leveraged to make the improvements. Force park itself
and the buildings within it and then you all had the city parks Bund ordinance.
And you had the financing last year and indeed several neighborhood parks war
leverage or pull it just in order to get that twenty five point two
million so that is how we have been doing it and. If you do not do
that then one must indeed in there's
a five A one c three organization with representatives from the members
of D.N.A.
And the city councillors office and that is how it's done and if you did not do
that then you would. Have to go to the voters and get
a general obligation passed for each financing and in this way you're using
existing taxes or you pass for instance
a new tax let me mention the pension obligation bonds we
went to the voters they passed
a one half cent public safety sales tax with that money we
issued pension obligation bonds in two thousand and eight and I believe in two
thousand and seven via the St Louis Minnes both Finance Corporation in order
to. Fund it. The.
Firemen retirement system police retirement system and also the employee's
retirement system so it is how it's done so the projects you mentioned where we
used buildings as collateral were for capital improvements on those buildings is
that primarily what I'm understanding the case temple improvements on the building
and or related. Facilities and or
streets you know infrastructure around those buildings but in this proposal we're
not. Doing any capital improvements cracked we are leveraging one building to
purchase landed an unrelated site correct is a common practice in the city is
a syndicate this is a method of having
a piece of collateral for the banks that were willing to do the line of credit
as opposed to more than one property we got it down to one
only one property as opposed to what was originally proposed being three
and we also have the ability to continue to borrow on
a parity basis for further improvements to fifteen twenty market at
a rate that we find acceptable they must match it or move out of the way.
And there is no limit it will be the loan to value and
we're getting an appraisal so that is that allows
a great deal of flexibility yet they still have some piece of property
by which they can use as collateral and we've knocked out nineteen hundred Hampton
and fourteen fifteen or thirty three so it's my understanding we've done some
creative financing in other projects but. That this is. The first time we've
mortgaged current buildings to purchase site unrelated to the project at least I
haven't I haven't understand I haven't understood any examples of US very similar
search situation here. We're marking time and I can use your list here OK that
would be helpful. Learn to say that what the city has done in the past is nothing
unique to the city of St Louis it's done all across the United States using biggest
financing any appropriation financing to finance the projects and the reason is
that fifty years ago. Significant portion of cities budgets were property tax
and so the method of financing projects was to do what you're going to do that in
August is go to the voters for
a property tax increase to pay for projects. Over the last fifty years everyone
knows that
a significantly larger portion of cities budgets and sales tax and other revenue
sources and so the annual appropriation lease financing that's used by US will
finance corporation and in every city and county across the country is
a way of taking frequently sales tax and taking
a revenue stream that already exists and financing projects. With that revenue
stream and so. So it's
a very common method of financing financing projects I don't know about city of St
But I will tell you we've done
a lot of projects in Missouri and other states that have used
that encumbered one facility as part of the financing of other of other assets for
instance you know if you have if you're doing street improvements streets don't
have
a it's hard to encumber streets and so it's not uncommon for us to encumber.
A city hall or some other facility like that to finance streets or or you know
some types of utility improvements so again I can't speak to but I'd say it's it's
common for in other cities for that to be done and in that case we would have
a secured stream to repay that debt is that correct Well I think. Most cities have
been identified will identify a
a revenue source so that when they when the comptroller's office submits the budget
to the board of Alderman. It's going to be
a line item to appropriate funds to pay pay that debt it's my understanding that
we'll be repaying this stat with possible earnings tax city state earnings tax from
the employees as well as the. Tax and if we do not secure if N.G.A.
Does not secure the site how will we be repaying this this loan Do we have a plan B.
For that. Plan for the city.
The city would indeed have to pay this loan back and with what funds
would we be paying the loan back if we do not have these jobs. Well the city would
have to find money within its back to. To do this that is
indeed the truth so if the city cannot find twenty million dollars within its
budget right now to do this how would we find twenty million dollars in
a year from now if. You really are going to have to find twenty again let me
clarify that we already oh the six and a half million that is already
a line item in the capital budget OK so that's being paid for already so you're
talking about the thirteen million that you are indeed
going to have to pay through revenues from the. That to.
The area the States kicked in the extra money and if there's
a difference you know yes the city will have to find the funds to take care of
this and do we have
a plan in place to find those funds but let me let me let me speak. OK so.
If you for part you've heard me say this before where we are in this to win it and
so we ultimately believe that we will be taken out by the actual purchase of this
but if in case that we do not we intend to be able to sell the land that we are
trying to basically assemble as one me their
various mechanisms for as extension and refine and restructuring of the debt itself
so it's not. A situation of finding thirteen million or twenty million all. But.
The amount that is currently being financed right now which is seven million that I
be speaking to there's
a stream of revenue that is probably paid so we'll be looking at ways to
restructure debt associated with that. Along with.
Looking at doing everything we can to get redevelopment onto the site that provides
for stream as well. I want to say that keeping the jobs is very important to me
personally the current N.J.
Site is right next to my ward it's important to our city to keep these jobs but
what concerns me is taking out a loan without
a secured revenue stream to repay it and I want to make sure that we've thought
through all this and that it doesn't have to come out of general revenue to repay
this thirteen million and it doesn't sound like we have
a dedicated. Stream to do so. With with the twenty million
dollars with the you know the thirteen million or whatever we're looking at what do
we plan to recoup that when we sell this but if we sell this building to N.G.A.
Yes and we are planning that they will pay us do we have
a an estimated cost. OK. So
the state has incentivized the moving of N.J.
Within the city limits by dedicating thirty years of state sales tax for in the
form of twelve million dollars per year how has this state incentivized the moving
of the site to St Louis County. And how does that compare there are there are three
situations in the states Bill one they were used to protest on the other locations
here they will use withholding taxes so essentially though up to twelve so they've
expanded the state. Allocation from its current. Cap
at thirty two to forty eight to forty eight million I believe it is an annual basis
and they have to appropriate every year for that but so so the other two sides
would be super to this would be through. Appropriations of the withholding tax and
the total package sense would you which would you classified as the most
incentivized location on behalf of the foot by the state. Park for the for the most
part except the probably is a little more in
a sense that there are more things to do because it's an urban site as opposed to
a green feels like. OK Thank you. A woman grin.
I think you. Most of my questions were asked by the holder woman from the twentieth
but I do have
a couple Do we have an idea of how much debt we currently have on all these
properties that we've mortgage her leverage to and are we current on all of those
payments. The city's credit rating was just reaffirmed.
By Fitch we have an A plus rating by Standard and Poor's some other
rating fit this summer
a ding by Moody's. Way so. We pay all our debt first
and at the capital committee that's the for those of the first line items that are
proved we would not be rated an A plus three major rating agencies if we did
not pay our debts and we always do so if. We're not to
go here and we were not able to repay on that twenty million loan or fifteen
million or thirteen million loan. And find another revenue source within the
general operating budget that would potentially put our credit rating in jeopardy
as well we are not in the in the least bit concerned about that because we
indeed. Will will further develop the property and
sell the property. I'm not worried about the rating of the
city being downgraded it's been this way now for. Perhaps
twenty years or so and. We're kind of
a little bit. More experienced in ways to handle this.
Then people would think we just don't allow that to happen when I came to the city
we were not in and. That was twenty five plus years ago I remember the day we
garden and I ran around like
a child having gotten the biggest Christmas present ever I sincerely doubt that we
will let our eight plus drive. A long time coming. So the other question I have
is I've heard you say you know several times kind of plan B.
Is we will sell this land you know one of the arguments when you know we were
debating this back earlier you know in the year was that you know nobody wants this
land that it's vacant it's there's barely anybody living there it's had lack of
reinvestment for you know twenty plus years so how do we have faith that if this
doesn't come through that you know miraculously Now there's people willing to buy
it because the state has seen fit to also give us sixteen million dollars in
brownfields that will allow us to clean it and to do some demolitions we will have
improved this far better than when I probably made those statements. We will.
As I mentioned other programs that are that are happening in and around that we
will of it improve the access in two directions to get to the site.
So there are some ongoing things I believe that we also have had
a number of folks who have
a shown interest in trying to do things right now the redevelopment environment in
the city of St Louis is. One hundred percent better than it was three years ago so
we have people who are who are looking to locate we're looking to find
a simple sites obviously this one is it will be is
a challenge one because of some of the bites and things that exist but we we think
we have the wherewithal to be able to make it attractive for such for buyers to
have
a centrally if we particularly we have it all assemble where we don't have. Pieces
missing from it so have you put together your plans B. C. D.
You know who you would be attracting to this area. Right now all of my energy is
focused on in GA and we will. You know refocus on plan
B.
If we figure that we are going to we're going to get there but we think we. This is
one of the things that we meet with the Corps of Engineers and within GA on
a regular basis and we have we know at this point what to expect patients
are we know that it has to be assembled by and we have to turn it over that's the
one on are we know that we have to have it completely clear of
buildings we know that it has to be environmentally made all the environmental
tests by D.N.R.
We know that it has to be all the streets and alleys need to be vacated we know
that. That we need to have clean the soil down to
a certain depth in certain areas we need we know that we need to reroute all the
utilities and that kind of thing so we have this down and we have the team in place
to move ahead so what we were asking is for. For your assistance and us
and helping us get there no further questions at this time thank you. OK we've
got. At this time I need
a motion that we adjourned. Session. Will be
going to close session to discuss would be the purpose of close session that's the
discuss specific finances and really to be able to share with you the sources and
uses just because some of the things on it were preferred to.
We were dealing in a sort of a little leverage negotiations kind of
a thing and so. I would prefer not to negotiate in
a public forum if I if I can't. It puts us at
a disadvantage. In trying. To be very. Fruitful with.
The public's money when any notification requirements for us to be able going to go
in session yes that it was probably notified.
Is there
a motion. Second movement second in command Kirklees called the roll. Ottoman
Bossley all McKenna they all the mic Conway all the woman across the aisle them
anymore all the woman day this. Ottoman French. Ottoman Carter.
Ottoman culture. Ottoman Spencer right out of them and green I
famine Rody I seven I vote OK I'm supposed to read this now the Housing Urban
Development Committee shall convene a closed session under the provisions
a section six one zero point zero two one one of the revised statute the state of
Missouri for the purpose of the sky sing with legal counsel to the Board of
Aldermen matters related to legal actions causes of actions and litigation vowing
portable cities will settle to get the right think it should be real estate I think
is realistic. But isn't really at this point will ask that the cameras see and.
I'm not sure I guess. That employees I guess those representing other branches of
government are welcome to stay but any. General popular public our.
Media are requested to leave it to snow. You
have
a form on Friday you want to start it thirty instead of. Two issues now. OK
Yes. Yeah you're calling.
All right and that's. I guess that's.
Right. Thank you. Lynn.